40A:20-16. Net profits of a nonprofit entity
16. An urban renewal entity which is a nonprofit entity under this act shall be subject, during the period of the financial agreement and tax exemption under this act, to a requirement that it shall pay over its net profits, if any, to the municipality within 90 days after the close of its fiscal year.
The entity may maintain during the term of the financial agreement a reserve against vacancies, unpaid rentals and contingencies in an amount established in the financial agreement not to exceed 10% of the gross revenues of the entity for the last full fiscal year, and may retain such part of those net profits as is necessary to eliminate a deficiency in that reserve. Upon the termination of the financial agreement, the amount of reserve, if any, shall be paid to the municipality.
If an entity purchases an existing project from another urban renewal entity, the purchasing entity shall compute its net profits, if any, commencing with the date of acquisition of the project. The date of transfer of title of the project to the purchasing entity shall be considered to be the close of the fiscal year of the selling entity. Within 90 days after the date of the transfer of title, the selling entity shall pay to the municipality the amount of reserve, if any, maintained by it pursuant to this section, as well as the excess net profit, if any, payable pursuant to this section.
L.1991,c.431,s.16.
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